How Have We Been Trapped In The Debt Bubble And Why To Avoid Bankruptcy

Many American today are trapped in the Debt Bubble. With the huge amount of credit card offers, we are constantly mailed and bombarded, is it a wonder that something like three million people filed for bankruptcy last year?

That was a made rush to avoid the new harsher bankruptcy laws that went into effect October 2005, but its still a lot of people. With the new bankruptcy laws emphasis on credit counseling and education, you might as well go into Debt Consolidation on your own, and avoid court payments and lawyers fees. Sometimes I think the goal is to reduce Americans to the status of Third World debtor countries that owe huge debts, make huge payments, and then after 20 years owe more money than they did at the beginning. Look at what happened to Brazil, where they make a huge export income, solely to service their debt.

Unless our situation radically changes, debt consolidation really means working more and enjoying less. However, there is also a huge amount of frivolous spending that can be relatively easily eliminated. Do you really need those $5 to $15 lunches at work, or can you take along a $1.00 bag lunch? This is the type of change that can make debt consolidation successful, and why changes in lifestyle are so important, because using credit cards all the time is a lifestyle based on living for today and not worrying about tomorrow. Debt consolidation can even effect what universities your kids go to. Can student loans really pay for everything? In a world where people use credit like madmen, it is no surprise that so many people need debt consolidation loans. A debt consolidation loan, if used correctly can help. Debt consolidations are loans that replace a single debt for your 20% interest credit card loans.

You can use equity from your house, with a second mortgage, to give yourself a breathing space to alter your spending habits. If you go into Chapter 13 Bankruptcy now, under the new laws, you are going to have to go to credit counseling and suffer through various forms of behavior modification on your spending habits anyway. The danger is that if you get a debt consolidation loan, and dont use it properly, youll be in worse shape than before. Youll lose your house and everything else. So learn to change.